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HMRC have updated their National Insurance rules today as the EU notified the UK that all member states will be applying for the detached worker provision. This means that any workers who are temporarily moving between the UK and the EU will continue to pay into the social security system for their home state.
This will impact employees, the self-employed and employers themselves.
Currently, if a person works in the EU, Norway or Switzerland, they’ll only have to pay into one country’s social security scheme at a time.
HMRC details this will usually be in the country where the work takes place but if a person works in certain occupations or is only working temporarily throughout Europe, they may be able to get a certificate or document that’ll allow them to continue paying National Insurance contributions in the UK.
If this is done, the payee will not have to pay social security contributions abroad.
According to today’s update, a worker, or their employer, should apply for a certificate or document if they’re:
- Going to work temporarily in the EU for up to two years
- A multi state worker working in the UK and one or more EU countries
- A civil servant working for the UK government
- Working onboard a vessel at sea, with a UK flag
- Working as a flight or cabin crew member, where the home base is in the UK
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However, where work is being done in Iceland, Liechtenstein, Norway or Switzerland, different circumstances will come into play.
Workers or employers in these circumstances should apply for a certificate or document to continue to only pay National Insurance contributions in the UK if they’re a:
- National of the UK, Iceland, Liechtenstein, Norway or Switzerland, who started working in Iceland, Liechtenstein, Norway or Switzerland before January 1 2021 and have been working there since
- National of Iceland, Liechtenstein, Norway or Switzerland, who was resident in the UK before January 1 2021, including if they have EU Settlement Scheme status
- Family member of a national of, Iceland, Liechtenstein, Norway or Switzerland who has status under the EU Settlement Scheme, and they’re residing in the UK
- Person with dual nationality, one of which is the nationality of, Iceland, Liechtenstein, Norway or Switzerland
- National of the UK, Iceland, Liechtenstein, Norway or Switzerland who is a multi-state worker, meaning that they were working in two or more countries of the UK, Iceland, Liechtenstein, Norway or Switzerland before January 1 2021 and continue to do so and they work predominantly in the UK
The methods for applying for these certificates or documents will vary depending on the claimant’s circumstances.
Workers or employers will need to complete either a CA3822, CA3837, CA18421 or CA3822 form depending on their working arrangements and the details on this can be found on the Government’s website.
HMRC may advise claimants that they must pay UK National Insurance contributions and if they do, they’ll issue a certificate or document for claimants to use as proof that they do not have to pay social security contributions in the EU, Iceland, Liechtenstein, Norway or Switzerland.
Should a claimant’s circumstances change, they’ll need to check with the Government to see if they’ll face new social security rules.
In the UK, the amount of National Insurance paid by workers is dependent on their employment status and how much they earn.
Employed workers will pay class one contributions, with the current rates being 12 percent for those earning between £792 and £4,167 per month and two percent on anything above this.
Self-employed workers will pay class two and/or class three contributions, with the applicable rates being dependent on profits.
There are also different National Insurance rules for those who are both employed and self-employed, directors, landlords and share fishermen.
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